Author Archives: John Keeley

A Beginner’s Guide to Marx’s Capital

“A critique of political economy” was the subtitle of Marx’s book Capital. The political economists portrayed profit, rent & wages as the just returns for the three factors of production: land, labour & capital. Marx argued that such surface level appearances were seriously misleading. That both profit & rent actually came from value created by workers. Furthermore, that capitalism was just the latest mode of production, & that because of its contradictions would be replaced by a higher form called communism.

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Theory of the Business Cycle

I can only see Marxist theory as having a coherent explanation as to why capitalism is crisis prone. Yes, there are capitalists that have partial theories, but nothing that can fit into a general theory because they have the wrong theory of value. That is not to say that Marx had worked out & presented a fully formed explanation of the business cycle, or that Marxists today all have the same explanation. Just that only with Marx’s theory of value can you then go on to have the concept of aggregate market prices being inflated above their value equivalent due to leverage from the credit system. Yes, that is an asset price bubble, but it also applies to everyday commodities. And because you can never fully regulate or abolish the credit system all the time you have capitalism, the business cycle & so recessions can never be smoothed away with ‘stabilisation’ policies. All the central bankers & finance ministers can do is reflate asset prices at any hint of them popping with yet more debt (leverage); yet more distortion of prices from values. And they have done this to an unprecedented level because fiat money has allowed it. They haven’t had to worry about maintaining the value of their currencies. That is until now. They have now seemingly reached the cliff edge. I don’t think that there is a way back for them. The working class need to push them off.

Labour Values & Exchange-Values

A commodity takes a certain amount of time to produce. This amount of labour time has an equivalent in the form of the commodity that acts as money, historically gold. So with gold acting as money the market price, if sold at it’s value equivalent will be a weight of gold equivalent to the amount of labour time that went into its production. This is the simplifying assumption Marx makes in Volume I of Capital.
Now of course commodities in different industries have different turnover times & different labour-capital intensities; hence Marx’s ‘prices of production’ in Volume III. Still with the simplifying assumption that aggregate prices of production equate with aggregate values.
With supply & demand fluctuations market prices do not even equate with prices of production, unless by accident. But even here we can still say aggregate market prices will equate with their value equivalents.

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The Problem For Those Who Have Never Read Marx

The problem for those who have never read Marx, or at least never had it explained to them, is they seem to think the political system we get is based upon ideas, & that the word ‘communism’ simply represents a bad idea, even if by that they mean ‘good’ idea in theory, but results in a ‘bad’ reality.

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The Importance of Communes

The Russian Revolution & the experience of the Soviet Union helps clarify two important aspects of political theory:

1. The nature of working class democracy
2. The stages involved in the transition to communism

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The form of working class democracy was first clearly identified in what was the first workers’ revolution: the Paris Commune of 1871. This lasted just two months before the Communards were massacred in their thousands. The democracy of the Commune was not a parliamentary one. It was a working body as well as a law-making institution. Both executive & legislative. Not a talk-shop for puffed-up egos. Those holding office were paid the salary of an average manual worker. They could be recalled at any time. It was a much more participative democracy than the ‘vote once every five years’ so-called representative democracy of Westminster.

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The Transition to Communism

The Russian Revolution was not the first workers’ revolution. In 1871 the Communards set up the Paris Commune. It lasted for just two months before the French army massacred them. Between 10,000 to 20,000 were killed with many more put in prison & thousands deported. Lenin’s book State & Revolution, written a year before the October Revolution, has the experience of the Commune at its heart. He repeats Marx’s assertion that the Commune is the form of working-class democracy, not bourgeois parliament. It was to be the ‘dictatorship of the proletariat’ that waged on-going class struggle after the revolution to create the classless society of communism.

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The Legacy of the Russian Revolution

There was considerable debate in Marxist circles before the Russian Revolution as to whether Russia could have a proletarian revolution or not. Whether it should limit itself to a bourgeois revolution, like the French one. Marx being the scientist that he was, was open to the possibility; as we couldn’t know for sure, in advance, that it wasn’t possible.

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However, given the fact that workers made up probably less than 5% of the population, a pure workers’ revolution didn’t seem realistic. But could an alliance with the peasants, rather than the emerging capitalist class, defeat the feudal class of landowners & continue to communism rather than stopping at capitalism? Trotsky, who was initially a Menshevik, not a Bolshevik, thought so & his theory of permanent revolution won over Lenin, who was initially sceptical. Lenin knew though that Russia could only be the ‘weak link’ in the world economy & that ‘socialism in one country’ wasn’t a possibility. The revolution had to spread, preferably to Germany, France & Britain for it to be successful. It didn’t, largely due to the reformism of the Social Democratic Party in Germany & the Labour Party in Britain. Not forgetting the involvement of British & other foreign troops in fermenting civil war.

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Historical Materialism

The problem in politics is many people have a poor understanding of what drives human history. They have a view based upon idealism rather than science. In philosophical terms, idealism rather than materialism. They think that it is purely a battle of ideas without understanding the material basis for these ideas.

Historical Materialism

If we look at the broad brush of human history we see technological change as a driver of changes in economic systems: pre-agriculture hunter-gather societies, slave & feudal systems of agricultural societies &  the capitalism of industrialised societies today. With these changes come changes in productive relations in society. With agriculture we get class based societies: those who control the land & those who work the land, e.g. landlords & serfs; with capitalism we get those who control (own) capital, whether in the form of factories or just money capital, & those who have to work – hence the class based nature of our society. As all profit ultimately comes from the workers’ labour, we have the class struggle between profit & wages.

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The Case for Participatory Socialism

The material conditions that shape political consciousness are changing. Despite the Tory election victory, politics is catching up with economics with increasing numbers disillusioned with the political system & capitalist exploitation. People no longer expect to see their standard of living improve & the younger generation are considered lucky if they have a job & a home. The system is failing increasing numbers. More than ever we need an alternative & if we present the case well we really can change the world.

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The Material Conditions

Firstly, we need to understand the economics if we want to understand the politics. Finance capital is in a precarious position. For at least the last four decades it has reigned supreme with its neo-liberal ideology based on the free movement of capital & privatisation. The problem is it has been based upon debt, & this debt has now reached unsustainable levels. The crash of 2008 showed us its fragile nature. It is once again heading for a fall.

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The Trouble With Pigs

The pigs I am referring to are the pigs of George Orwell’s Animal Farm: the Communists. The animals that think they are ‘more equal’ than others. As a ‘pig’ myself, this is not an argument against pigs. Rather, I seek to answer the problem thrown up by ‘uneven consciousness’: how to give these people the organisation structure to intervene effectively in the class struggle & to spread their revolutionary class consciousness without them becoming a class in themselves?

Pigs

As many are aware, this subject has a long history. The debate has centred upon the role of a workers’ state & the internal organisation of revolutionaries. The Paris Commune of 1871 was arguably the first ‘workers’ state’. Today revolutionary groups do not define themselves by it, but they still do in regards to the Soviet Union. For Stalinists it was a workers’ state, for many Trotskyists it was a ‘degenerated workers’ state’, for Anarchists is was a ‘coordinator class state’, for others it was a form of ‘state-capitalism’. Did the Soviet Union act in the interests of working class or not? This is an important question, but more than a quarter of a century after the fall of the Berlin Wall & a century after the Russian Revolution, it should surely not be a reason for revolutionaries to organising themselves in separate groups.

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